Ups & downs
NZ biofuels industry changes gear after subsidy ends.
Tourist operators and trucking companies may be unable to choose biofuels for the next few years, after the end of a government subsidy designed to kick-start the industry.
The Biodiesel Grants Scheme had given a grant of up to 42.5 cents per litre to biodiesel producers. But despite lobbying from The Bioenergy Association and others, the government declined to renew it once the initial three-year scheme came to an end in June. Brian Cox, executive officer of the association has said the result has been the closure of several small biofuel plants and an end to three years of development work at a time when the industry was starting to gain new customers, particularly in commercial vehicle fleets.
“It has changed the dynamics completely,” he said. “Up until now the focus was on getting people used to using biofuels. The grant was helping users access fuel that they could get used to. All of that has stopped. For example, from the point of view of the tourist trade being able to say we are pure green and using an environmentally-friendly locally sourced fuel they can’t get the fuel to be able to do that.
“The focus has now moved to the development of more advanced biofuels, which in New Zealand will be principally sourced from woody biomass. But that technology is a few years away from being able to put fuel on the market, so we have now got this hiatus as far as some consumers are concerned, who will have to wait while the new technologies are developed.”
Meanwhile, Cox said wood milling companies like Norske Skog and Carters are actively looking at converting their facilities to biofuel production, a sign that the industry still has a bright future. And despite the changes, the Gull service station chain is continuing to offer biofuel blended fuels on its forecourts around the country made in New Zealand from a natural by-product of the dairy industry’s activity, or from sugar cane grown in Brazil.